The day you come up with a new idea for a service, product or a marketing method is the day to start thinking about the next one. The definition of innovation is “the introduction of something new”. It doesn’t say “introduce something new and stop”. There is a caveat: too much innovation can sink a business just as not having innovation can.
In an entrepreneurial stage a business uses innovation as a “quick hit” to generate fast income. There is more risk and usually less planning involved but if successful, the reward is a quick payout. In many cases, due to a lack of working capital, small businesses may have to take a “fast growth” path.
“Need” is a great innovation creator. When funds are short and income becomes a critical survival issue, then the “need” factor kicks in. In most businesses a short term solution to cash generation exists. The answer does not necessarily have to be borrowing on your credit card or borrowing from family or friends. In a consulting situation with a small business in need of a short term cash solution I ask the following in order to determine if a short term solution is applicable:
- What got you into this situation?
- How can it be rectified?
- How much cash do you need?
- Are you willing to create a strategic focus/marketing plan to avoid this in the future?
If it appears that the business can be saved and restructured for growth, then the best quick cash generation plan is implemented. There is always a risk when everything is placed in one basket, but small businesses sometimes have to take it.
In a stabilized business a different type of innovation is used; it’s called “incremental innovation”. Ongoing innovation is a must for all companies in all stages of their growth, but as a company matures the innovation risk is spread among more projects or products.
Innovation, in my opinion is about being able to see the future and getting there first. It’s about having a vision about the future which allows you to channel your efforts to get there. There is no map, thus as a business owner you will have to forge ahead and explore the horizon by yourself. Innovation also requires letting go of the past; any successes that you experienced in the past are not guarantees for future success.
“The winners will be those who stay ahead of the change curve, constantly redefining their industries, creating new markets, blazing new trails, reinventing the competitive rules, challenging the status quo”. (from “Rethinking the Future”
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Nick J. Petra CFP business coach & mentor www.strategicduck.com